The following income statement was drawn from the records of Vernon Company, a merchandising firm: Required a. Reconstruct the income statement using the contribution margin format. b. Calculate the magnitude of operating leverage. c. Use the measure of operating leverage to determine the amount of net income Vernon will earn if sales increase by 10 percent Complete this question by entering your answers in the tabs below. b. Calculate the magnitude of operating leverage. c. Use the measure of operating leverage to determine the amount of net income Vernon will earn if sales increase by 10 percent. Note: Round your intermediate calculations and "Operating leverage" answer to 2 decimal places. Round the "Net income" value to nearest whole dollar